How Obamacare Raids the Assets of Low-Income Older Americans

One feature of Obamacare that Lambert has mentioned in passing in his posts is that individuals over 55 who are enrolled in Medicaid are subject to having expenses like being in a long-term care facility, home services, and related drugs and prescriptions clawed back from their estates. A must read post at Paul Craig Roberts details how pernicious and sneaky these provisions are.

The pilfering of assets of low-income Americans results from the interaction of several nasty features, and the article contends none of these were an accident (as in objections were made when the Affordable Care Act was being drafted and were ignored).

The estate recovery feature of Medicaid is pre-existing, from the Omnibus Reconciliation Act of 1993. But it didn’t seem to have much practical effect when it was added because Medicaid had an assets test which meant that people with meaningful assets were not eligible. As the article explains:

OBRA 1993 requires all states that receive Medicaid funding to seek recovery from the estates of deceased Medicaid patients for medical services received in a nursing home or other long-term care institution, home- and community-based services and related hospital and prescription drug services regardless of age. It also allows, at state option, recovery for all services used in the Medicaid state plan at age 55 or older. At minimum, states must pursue recovery from the probate estate which includes property that passes to heirs under state probate law, but states can expand the definition of estate to allow recovery from property that bypasses probate. This means states can use procedures for direct recovery from bank accounts and other funds. The state keeps a running tally, and even if you have a will, your heirs are chopped liver. Estate recovery can be exempted or deferred in certain situations after your death, but the regulations for this are limited and complicated with multitudes of conditions.

Now consider the ACA changes. First is that Obamacare expanded Medicaid eligibility. The ACA ended the asset test.

Second is that enrollment in Medicaid is now mandatory. If you or your family make less that 138% of the Federal poverty level, which in the 48 states and Washington DC would be $16,105 for an individual and $32,913 for a family of four in 2014 you are enrolled unless you fit in a short list of categories, such as being in jail, being in a state that opted out of Medicaid expansion, or being a member of an Indian tribe. You cannot opt out of Medicaid because you object to the estate recovery. You have to pay the penalty if you want out. And there are many routes by which you can become enrolled: by applying on an exchange and having it determine your income is too low to qualify for private insurance; by being in the SNAP (food stamps) database; by having an Obamacare plan but having a fall in income that puts you in the Medicaid category.

So if you have low income (by virtue of unintended early retirement, or even bad performance on your investment portfolio) but a decent level of assets, you can be caught in these provisions and have assets you had hoped to leave to family members instead taken by the government. And before you try arguing that that’s somehow fair, consider that the estate tax exemption is now $5.34 million. As the article points out:

Some might think it fair that those who are enrolled in Medicaid pay back the benefits they received. However, under a mandate that requires all Americans to be covered by health insurance or pay a tax penalty to the IRS, estate recovery is unconscionable since Obamacare offers no other viable option for this income-segment of the population. It also discriminates by age since only Medicaid enrollees who use benefits in the state plan at age 55 and up are subject to estate recovery, but those who use benefits at age 54 or less are home free unless they receive long-term care. Under federal law, discrimination is not permitted on the basis of age, but, obviously, the U.S. government turns a blind eye to to its own law. Perhaps, when states need more money due to the Obamacare expansion of Medicaid, and as the jobless economy continues causing more people to be eligible, age discrimination will be broadened to 45 and up.

But one of the most troubling elements is the lack of adequate disclosure about the estate clawback. Again from the article:

In June 2013 a letter was sent to the Centers for Medicare & Medicaid Services by a well-informed citizen pointing out that the Medicaid Manual prepared by CMS to provide guidance for states contains procedural rules intended to ensure that individuals are informed about estate recovery before they complete the application process.

There are variations in the ways in which states implement estate recovery, depending upon their Medicaid program and state laws. However, Federal law requires all states to incorporate the following protections for Medicaid recipients into the design of their estate recovery program:

— The State should notify Medicaid recipients about the estate recovery program during their initial application for Medicaid eligibility and annual re-determination process.
— The State must notify affected survivors about the initiation of estate recovery and give them an opportunity to claim an exemption based on hardship.
— The State must establish procedures and criteria to waive recovery if it would cause undue hardship.

The letter went on to say that the final CMS Health Insurance Marketplace application (healthcare.gov) notifies applicants about Medicaid’s right to pursue and recover any money from other health insurance, legal settlements or other third parties but does not disclose estate recovery. Since estate recovery is one of the terms of the Medicaid contract, it is deceptive to omit disclosure of this practice. CMS was asked to provide the reasons for this omission.

CMS responded evasively to the concerned citizen’s question. CMS claimed that the Health Insurance Marketplace application at healthcare.gov does not disclose Medicaid’s right to claim against the estate, because CMS wanted to provide flexibility to state Medicaid agencies as to how each one notifies applicants about estate recovery. Some states have developed pamphlets to address common estate recovery questions or devote a portion of a general Medicaid pamphlet to the subject. Some states also post their state plans, perhaps with additional explanatory text, on their web sites.

You can see the Catch-22 here. CMS puts the onus on states to make the notification, but people in the states that refused to set up exchanges apply through healthcare.gov. So consider this:

When you complete the application at healthcare.gov, it is assumed that when you submit it, you are fully informed and agree to all terms. Submission of the application is akin to signing a contract. Your signature not only means you have provided true answers to all the questions under penalty of perjury, but also that you understand and agree to all the rules and conditions. However, by not disclosing estate recovery CMS expunged your right to make an informed decision. Therefore, you may not realize that your estate can become government property because Obamacare forces you into Medicaid if your income is less than the threshold for a subsidized premium.

And here’s more state/Federal Catch-22:

Note that Obamacare applications contain a section titled Renewal of Coverage in Future Years. An applicant can agree to allow an exchange to use income data, including information from tax returns to automatically renew eligibility for 1, 2, 3, 4 or 5 years, or applicants can check “Do not use information from tax returns to renew my coverage.” Exchanges have access to the federal data hub which keeps track of your income and other personal data. If you gave unfettered access to your data by choosing auto-renewal, they have all the information needed to determine whether you are still eligible for your subsidized policy or should be moved into Medicaid.

The letter sent to CMS in June 2013 also asked about estate recovery disclosure in cases where coverage is auto-renewed during the annual redetermination process, when people are shifted from a subsidized plan to Medicaid due to a decrease in income or other change in circumstance, and when people are auto-enrolled on the presumption that they are eligible according to a database such as SNAP (food stamps) or by a hospital or health care center. A similar letter was sent to the Massachusetts Office of Medicaid.

The federal procedural rules on estate recovery say the state should notify Medicaid recipients about the estate recovery program during the annual redetermination process, but according to the Massachusetts Office of Medicaid, you don’t need to be informed about estate recovery during the redetermination process because you presumably read about this on the original application you filled out and submitted.

If you submitted an application that did not disclose estate recovery, it cannot be presumed that you are aware of estate recovery, because notification was not on the application. Thus, the redetermination procedure is one more example of the failure to disclose.

If you are bumped into Medicaid from a subsidized plan due to a change in your circumstances, the Massachusetts Office of Medicaid believes that you don’t need to be informed about estate recovery because you presumably read about this however many years ago when you filled out the original application. You will simply be sent a notice that you are now in Medicaid, and the notice will refer you to the Medicaid Member Booklet for information on the rules. If you obtain and read the booklet, you can learn that you may be subject to estate recovery. But don’t expect to receive a Medicaid Member Booklet with your notice, because “It would be cost prohibitive to include a Member Booklet with every notice. Instead, every notice includes information on how to contact Customer Service with any questions, including to request a copy of the Member Booklet.”

If these issues may be important to you or anyone in your family, I strongly urge you to read the post in full. It contains a great deal more important information. And it reminds us of how this is just another way to loot the public:

Obamacare was not written for the benefit of the poor and uninsured. It was written for the profits of the insurance companies giving them millions of new customers subsidized by U.S. taxpayers. The business of America is business. Private insurance company CEOs receive multi-million dollar pay packages, while under Obamacare low-income earners and the poor have to give up their homes and other assets in order to receive medical care.

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115 comments

  1. Skeptic

    In the mid nineties, I was involved in caring for an aging relative under Medicare. I did some research and, at a law library in a State Courthouse no less, found a book titled A LAWYER’S GUIDE TO MEDICARE written by a Law Professor. The book was written in a nudge-nudge-wink-wink style citing numerous ways to hide and move assets beyond the reach of the Government. I’m sure this business has expanded since then.

    As far as Medicare itself in those days, my research indicated to me that Medicare was a sink for political patronage and influence. For instance, getting a license for a nursing home certified by Medicare was solid Gold. Pharma was also into this big. I remember a prescription price skyrocketing 300%, the excuse being “change of supplier”. On and on as the money rolls in.

    As above, I strongly urge you to do your research and plan your strategy long before you have to deal with these Monstrosities. Just as a thought, for some carrying minimum insurance to comply with the law and then relying on Medical Tourism for one’s needs might be an option.

    1. DailyPUMA

      There is another side to this issue that relates to Medi-Caid versus Medi-Care. In home supportive services is supposed to assess/pay CareGivers, (many times a stay at home family member), a certain amount of hours per month to be an in home caregiver.

      The big picture is paying a CareGiver anywhere from a hundred dollars up to 2,000 dollars a month (after taxes) is cheaper than assisted living that apparently costs between 5,000 to 7,500 dollars a month and probably offers inferior care for an elderly person who has suddenly been taken out of an environment they have lived in for many years.

      For some bizarre reason the asset recovery aspect is pounded into the in home supportive services caregiver applicant even though it may not apply to them! For instance, if a person lives in the same home as the person they will be caregiving for, has been a caregiver for at least two years, and if their caregiving services are the only reason the parent is not in assisted living home, the asset recovery is supposed to be waived.

      However, the waiver eligibility possibilities are never mentioned, but the asset recovery is. The combination of mentioning asset recovery and then assessing low hours scares people off from becoming a caregiver. The assisted living places, which apparently can’t be sued for poor caregiving while getting paid top dollar (up to 3.5x times as much per month as a home caregiver would get) for what is presumably not as good services as a family caregiver could provide.

      Once the parent is placed in assisted living, the charges are used by asset recovery to siphon the wealth out of the home in an accelerated fashion since they do charge up to 3.5 times as much as a in home caregiver would be paid. I have no idea if actual medical procedures are charged at full value.

      As I fruitlessly navigate in home supportive services (it’s been a three year path so far with no payment yet for my ongoing Caregiving services), I have now learned that they won’t let my parent keep paying her 106 dollars a month for medicare. I think this is done so that they can begin to dismantle the amazing coverage my parent has, which included getting a pacemaker which may extend her life for many more years now.

      Very scary stuff is going on in which it appears that health care is becoming privatized and then the government swoops in recoup the money they paid the insurance company via the assets of the elderly. Even scarier is the bullying being done to family members who would rather become a caregiver than send their parent off to assisted living but are scared off of in Home Supportive Services, which ironically might actually save EVERYBODY money while keeping the elderly’s assets within the family.

  2. drfrank

    IMO, Medicare and SS transfers not prciously taxed should be recovered from the estates of all, esp. the 1%. Otherwise, they ar goverment subsidies to intergenerational wealth transfer, at a cost of budget distortions.

    1. spooz

      That would be hugely regressive, in that the 1% estates would feel nothing while the middle class would continue to shrink as their modest estates are “recovered” by government. Do you approve of such regressive taxation or do you propose another method of shrinking the intergenerational wealth transfer of the 1%?

    2. Dan Kervick

      Of course they are intergenerational wealth transfer. The current crop of working-age people supports the current crop of retirees. In return, those working people will be supported by the next generation when they are retired. It’s a social contract, not a plan for individual hoarding and self-financing of retirement.

      1. ambrit

        Mr. Kervick;
        I’m assuming that your comment contains a degree of irony. The “Social Contract” from the New Deal era has been broken; by the 1%rs. As for drfranks comment, perhaps the simple act of removing all caps on taxable income for Social Security and Medicare/Medicaid would be of some help. Also, perhaps something along the lines of lumping ‘estate’ taxes in with SS, Medi, and Income taxes as to percentages of taxation would also be of help.
        Sadly, I am becoming convinced that “individual hoarding and self-financing of retirement” is the New Neo-Liberal Social Contract.

    3. Jagger

      The 1% are not exposed to medicaid confiscation. In fact, the law was designed with a loophole for the rich and knowledgeable. There was a 3 year lookback for assets on estate recovery, now there is a 5 year lookback. The rich rent a lawyer and create an irrevocable trust if there is a concern about long term care. At $6-8000, the truly rich can afford nursing home care but if they don’t want to pay it, they create a trust and boom, no estate recovery.

      The reality for the great mass of people, including poor and middle class, is first they discover a parent has alzheimers or dementia and go into shock. A year later, they realize long term nursing care is going to be necessary and it is going to cost $6-8000 a month which they can’t afford. Then they look at medicaid and discover 5 year lookback on assets. Then if they can afford a $2500 to $10,000 for a lawyer, they can create an irrevocable trust if the dementia parent agrees or if they assigned someone power of attorney. Meantime clock continues ticking. Many simply aren’t capable of dealing with this sort of bureaucratic obstacle course while others don’t have the money and others don’t have the time. A few of the middle class and poor can run this course but most will end up losing everything. But not the truly wealthy.

      My father has alzheimers. Father has an old $60,000 house and 30 acres of land worth another $120,000 plus bank savings. He is not rich but worked hard all his life to put together what he has. He, mom and all the kids have payed the very taxes going to be used to pay these long term nursing costs. Yet since he lost the genetic lottery, the state will be taking his money, his house, his land, his old cars, his old boat and motors and everything else if he goes into a nursing home w/i the next 5 years. And the kids will not have a safety net or even a small inheritance of a paid off home and land if things get bad.

      When I worked in Silicon Valley, I always wondered how any low income people could afford to live there. I strongly suspect the ones that did, lived in inherited homes and a small bit of land. Just make sure no one comes down with dementia or alzheimers.

      The rich don’t get screwed by this medicaid business, it is everyone else who have paid taxes for medicaid all their lives.

      1. washunate

        Yeah, I hear what you’re saying and agree the laws are designed with plenty of loopholes for the rich. But here’s the conundrum:

        “He, mom and all the kids have payed the very taxes going to be used to pay these long term nursing costs.”

        The problem, though, is that they haven’t paid all the costs. Healthcare is mindbogglingly expensive, from super premature babies to very long term care.

        The healthcare system is reaching a turning point due to the fact that sufficient taxes haven’t been collected. In order to maintain the system, to continue paying the hospital franchises and drug dealers and nursing homes and medical equipment makers and so forth exorbitant prices, it is going to require significant new sources of taxation and/or money printing.

        1. Marcie

          I agree but can’t help but think we didn’t ask for it. I remember almost 30 years ago Reagan was touting the welfare queen that drove a Cadillac and kept having babies so she could live off welfare. And the masses bought into it even though the story was never validated
          .
          Even my neighbor told me she resented kids that got butter and cheese from the government when she was young because she couldn’t have butter it was too expensive. Now an adult she still doesn’t get it. It’s always about the corporations taking and never giving back that is the problem not hungry kids. And yet we still have those in Congress that believe people aren’t working because they are lazy. Oh the lessons we need to learn. When will it happen? I’d like to say in my lifetime but not sure that is realistic. Sure some are getting it but we need about 80% of the population to understand in order for there to be significant change.

  3. dearieme

    What’s the argument here? That the inheritances of some children should be protected at the taxpayers’ expense? You’ll be arguing for shonky schemes to avoid death taxes next.

    1. spooz

      Perhaps low income adults in the 55-65 age range who would like to leave their homes to their under/unemployed children would, at least, like the option of buying subsidized insurance instead of being forced to pay for expensive policies outside of the ACA to avoid losing their modest estates to Medicaid recovery.

      1. jrs

        That too. They dont’ even have the option even if they somehow have and want to spend the money that someone earning a little more (that falls under subsidization has). Its clearly discriminatory.

        1. Anon

          Conceding the discriminatory nature of the law, I kind of think dearieme’s question still applies. It’s heinous for the government to be confiscating assets in this capricious, regressive fashion, but it’s to pay for services already rendered. Whether the cost of those services is fair is moot as previous comments proved, but I don’t think we can plausibly argue they were unnecessary.

          A more elegant (and cruel) solution would be to further tighten means testing for eligibility, when standards, though variable, aren’t exactly lax right now. Aren’t we still deciding whose retirement and endowments to subsidize? Whether a person owns a home that can be sold for a million dollars or an equivalent sack of gold Krugerrands shouldn’t dictate whose healthcare is subsidized.
          Until we actually get single payer, taking money from the deceased to pay for goods that they actually consumed is perhaps not the worst result.

    2. kimyo

      the issue is that an estate can be hit for $250,000 when the true cost of care was $75,000 or less.

      the hospital ‘caring’ for your loved one has every incentive to maximize billings and provide unnecessary procedures.

      1. LucyLulu

        No. Medicaid can’t recover more than expenses. Medicaid does rigorous auditing of billing institutions, and has its own cost controls in place. The scenario you suggest would require providers to commit legal fraud and if caught, people can and do go to jail.

        As an aside, what expenses Medicaid can recover, and which assets can be taken, vary widely by state. For example, some states provide the homestead protection against Medicaid recovery. Others exempt a certain amount of the homestead’s value from Medicaid recovery. Others will take the whole thing (after other creditors are satisfied, e.g. mortgage lender). The homestead is typically the only or major asset of low-income folks who meet Medicaid’s income requirement. The wide differences in Medicaid recovery policies between states is why it was left to the states for disclosure.

        1. kimyo

          Jeffrey Singer: The Man Who Was Treated for $17,000 Less
          Bypassing his third-party payer, my patient avoided a high hospital ‘list price.’

          When the man arrived at the hospital for surgery, the admitting clerk reviewed the terms of his policy and estimated the amount of his bill that would be paid by insurance. She asked him to pay his estimated portion in advance.

          The insurance policy, the clerk said, would pay up to $2,500 for the surgeon—more than enough—and up to $2,500 for the hospital’s charges for the operating room, nursing, recovery room, etc. The estimated hospital charge was $23,000. She asked him to pay roughly $20,000 upfront to cover the estimated balance.

          Most people are unaware that if they don’t use insurance, they can negotiate upfront cash prices with hospitals and providers substantially below the “list” price.

          So we canceled the surgery and started the scheduling process all over again, this time classifying my patient as a “self-pay” (or uninsured) patient. I quoted him a reasonable upfront cash price, as did the anesthesiologist. We contacted a different hospital and they quoted him a reasonable upfront cash price for the outpatient surgical/nursing services. He underwent his operation the very next day, with a total bill of just a little over $3,000, including doctor and hospital fees. He ended up saving $17,000 by not using insurance.

          i don’t know what’s in the ACA. it looks like an asset grab, though. i hope i’m wrong and there’s no chance that hospitals will be billing estates for the ‘list’ price of procedures.

          1. LucyLulu

            First the hospital bills Medicaid, when the person has the surgery. Later, after the person dies, the state that administers the Medicaid program would go after the person’s estate. So no, the hospital isn’t billing any estates, or anybody else, for “list prices”. The hospital is billing Medicaid at Medicaid prices.

            It’s when somebody is uninsured or underinsured that the hospital can go after the estate for “list prices”.

            The case can rest on it’s merits. Let’s not add unfounded charges.

            1. kimyo

              i finally finished reading the paul craig roberts post. i know it sounds like i have an ax to grind, but it does seem to me that if your state is one of the 35 (?) moving to ‘medicaid managed health plans’ and you need treatment out of network your estate could very well be dinged for the ‘list’ price.

              i appreciate your answers and the clarifications you’ve posted. i’m not trying to add unfounded charges. however, i believe there have already been cases where people in need of emergency/specialized treatment find no ‘in-network’ options available.

              1. LucyLulu

                I don’t know if you’ll return, Kimyo. However, while I’m not absolutely sure if what we have here is considered Medicaid managed care or not, I tend to think so. We were paid a capita rate for providing comprehensive outpatient behavioral health services for our clients. I believe there were two different programs for Medicaid at the time, one managed care and one not, though we saw folks in both plans. Non-participating Medicaid providers, when our folks needed medical services, wouldn’t see our patients. The wrong kind wouldn’t either. Patients had to display their card when they checked in, every time. I don’t think non-Medicaid providers will treat Medicaid people, except in life-threatening emergencies (when anyone will, or should, treat you). And if one has to travel and is unable to see an in-network provider, I’d bet my last dollar that Medicaid would pick up the tab, assuming it was a Medicaid provider in the non-local area perhaps. Every area has some Medicaid providers, usually at hospital and community clinics, and most ER’s of course, as well as the odd private doctors.

                About going out of network: all insurance cards have 24 hr toll-free numbers for pre-authorization. If there is any question about coverage, call and ask. If one really needs medical care though, and all providers in the area are deemed out-of-network by your insurer, as Yves says has sometimes happened (though I wonder if these claims were appealed), I guess you’re kinda screwed. I only know from my own experience with lots of different private insurers and HMO’s, that when nobody was available in-network within 50 miles, an out-of-network provider was paid at in-network rates. I did call first and get pre-authorization however for going out-of-network.

                Finally, if you get your insurance through a large corporation, and you run into a claim denial that can’t be negotiated successfully, a call from HR on your behalf can be your best friend. HR is who negotiates the contract for the following year, including choosing the company. Insurers tend to cater to HR. Your state insurance commissioner is often another helpful resource for individual policies and small and medium employer-based insurance (but rarely large employers, who are almost always self-insured, using an insurance company only to manage enrollment and claims administration, thus falling under the Dept of Labor’s jurisdiction, who provides essentially zero oversight).

                The most common Medicaid expenses that states seek for recovery are either long term nursing home care or long term in-home care and related hospital/drug expenses. These people would be unlikely to ever need emergency out-of-network care. And again, if no specialist was available in the area, I’m pretty sure Medicaid would approve a waiver to pay higher rates for a non-Medicaid provider…… or pay for transportation to the closest one….. or arrange for one of the telemed consultations introduced about 20 years ago to serve underserved areas (that have no specialists, Medicaid or otherwise).

                Billing mistakes are common with hospitalizations, no matter what kind of insurance one has. It’s prudent to always check one’s bill for accuracy when the bill is received (while memory is fresh and errors can be more easily corrected). I wouldn’t suggest waiting until the estate recovery process for your heirs to try to dispute charges.

    3. CB

      No, the argument is that estate confiscation is falling entirely on the poor, after they’re forced into a confiscatory insurance program, and without an opt-out option or information about the estate clawback. If you’re comfortably out of the income range of enforced Medicare enrollment, perhaps you think sweeping the assets, such as they are, of the poor is good policy? It’s really just more rent extraction. Another asset seizure opportunity, from the Clintons, no less, but only from the lower classes, of course.

    4. Patricia

      Don’t conflate the small inheritances passed to the lower/middle classes with those given to the children of the uber wealthy.

      There is a tradition as long as humanity, to leave something for the next gen to get a start, and that’s particularly important in light of the current educational debts heaved onto our children.

      This tradition is understood re general inheritance taxing, which makes this action particularly vile. I do not understand why it is not apparent to you.

      1. Patricia

        And why not make this true for every poor person who’s ever been on Medicaid? Let’s start with the 3 yr olds. Or to be fair, maybe we should pick out only those with expensive chronic health problems.

    5. jrs

      I think theargument here is medical costs should be socialized and paid via taxes, not subject to estate recovery.

  4. allcoppedout

    We get similar in the UK. Go into care and they take what they can of your estate. The matter is a political football, much along dearieme’s line. We have this weird idea our legacies are hard-earned and should be protected by insurance we have never paid.

    1. spooz

      The problem in the states is that if you don’t make enough money, you don’t even get the option of participating in the subsidized ACA insurance markets. You are forced to buy expensive insurance outside the ACA market or risk your estates being reduced by Medicaid recovery, if you are in the 55-64 age range.

      1. kimyo

        and many are being forced into medicare as companies like ibm and ge move their retirees off of their health plans.

        IBM To Move Retirees Off Its Health Plan Due To Rising Costs

        An IBM spokesman said Saturday that the change will affect about 110,000 retirees who are eligible for Medicare.

        Under the change, IBM will make annual contributions to health-retirement accounts. Retirees would use the money to buy Medicare Advantage or supplemental Medigap policies through a private Medicare exchange.

        1. NotTimothyGeithner

          My thought this about discouraging retirement. These companies have not hired young people for so long they can’t economically replace retiring workers because experience can go a long way, but when the current guy doing a job started, there were 7 others. Today there are 2 getting by because of experience, but if one leaves, the operation shuts down.

          They need these people to keep working because a random educated waiter c ant jump in to workloads developed through experience and relationships, not even two or three

        2. Waking Up

          Keep in mind that Medicare Advantage and Medigap are offered by Private companies. These were “back door” entrances into the Medicare system by private corporations. Basically, IBM is transferring the cost of who will pay for the private insurance from the corporation to the employee.

          1. Waking Up

            Correction. IBM is transferring the retirees from one private health insurance plan to a different private insurance plan.

            1. LucyLulu

              Exactly. These people are already on Medicare. The company is paying for a supplemental private policy to cover what Medicare doesn’t. Instead, IBM is going to give their retirees money to buy their own supplemental policy.

              Hell, few companies offer their retirees any health benefits anymore, just as few offer pensions. I’m sure the number will continue to decline. Old people are living too high off the hog.

      1. Synopticist

        The NHS is paid for from central taxes. Free at the point of use.

        The difference is, if you go into an old persons home, rather than a hospital, that’s not free. It’s incredibly expensive, from around £400 absolutely minimum per week and upwards from there. Quite often the local government will pay for it, and then seek to get it back from the estate. There’s a lower limit of something like £27 thousand which they can’t touch.

        Like Allcoppedout says, it’s a massive political hot-potato, because it costs so much and lots of boomers are expecting to get their parents houses when they die. Unfortunately, there’s no real culture of looking after your extremely elderly parents in their dotage. Politicians don’t want to touch it, because they lose either way, but somethings got to give.

        1. allcoppedout

          There are other aspects to this. We increasingly have poorly paid people doing the caring, some of the standards are dire and people are living longer, needing care longer. None of us can really afford to pay for these services or even our pensions in the current system. What we need to do is change the financial system and culture. Japan now has a 5000% increase in crime committed by the over 65 group -prison being a better alternative than living alone in poverty.

        2. sleepy

          Under the present Obamacare plan, those poor who are forced into medicaid and are between the ages of 55 and 65 (the medicare eligible age) will have ALL their medicaid expenses seized by the state on their death. This includes doctor visits, hospitalization, prescriptions, etc. It is not just limited to nursing home care. That is different than the NHS.

          At age 65, medicare pays those expenses and they are not subject to estate clawback. The exception is nursing home expenses which are not paid by medicare. Those expenses will be paid by medicaid and subject to the clawback.

  5. Ep3

    What about asset clawing back from the next generation? Could Medicaid go back on the old folks’ children’s assets? Because the state could argue that a rich person knew he was getting sick, so this rich person moves all their assets to their children/grandchildren then they can establish there’s nothing to claw back and the state could say “Jenny, u as the daughter of Tom signed these releases authorizing this care, we wanted to dump Tom in the street but u instructed us to provide this care, we have a court order saying you are responsible for payment”.
    And I still do not understand how is it that ppl are forced into medicaid. Again, I have asked on this site about when u notify the exchanges that you have employer offered insurance, this prevents you from seeking exchange provided insurance, and what I thought was Medicaid as well. So if you work at Walmart for $8 an hour, and Walmart has a health insurance plan, you have to take their plan over “better” options on the exchanges or medicaid. Maybe I am wrong.

    1. Jim Haygood

      Cash-hungry states have already thought of your idea:

      In states that have so-called “filial responsibility laws,” nursing homes may seek reimbursement from the residents’ children. These rarely-enforced laws, which are on the books in 29 states, hold adult children responsible for financial support of indigent parents and, in some cases, medical and nursing home costs. In 2012, a Pennsylvania appeals court found a son liable for his mother’s $93,000 nursing home bill under the state’s filial responsibility law.

      http://www.elderlawanswers.com/medicaids-asset-transfer-rules-12015

      1. Jagger

        Here is a libertarian website with an article by Matthew Pakula advocating states, including my state, enforce filial responsibility laws and go after children for long term health care costs (debts) of parents. Yes there is much evil in this world.

        http://www.ncpa.org/pub/ba521

  6. ohmyheck

    I am in the income bracket where I would qualify for Medicaid. I was told this last year by my tax preparer at H&R Block. I pay for my own private medical insurance with Blue Cross Blue Shield. Am I going to be forced into Medicaid, even if I have insurance that meets ACA criteria? I don’t know if my state opted out of Medicaid expansion.

    I would hazard a guess that the best option is to sign over all my assets to my daughter when she turns 18. I have a Family Trust and my assets are in the trust, bust is sounds like that trust won’t do diddly-squat to keep my house for my kids.

    Cashing out my investment portfolio sounds like a pretty good idea as well. Take the cash and hide it in the mattress. If I leave it as is, they will take it in the next stock market crash. If I cash out and leave it in a bank account, they will take it when they do their Cyprus-like Bail-In. Or confiscate it all if I get sick.

    Where is craazyman to make sense of this? Cuz I see no reason to work and save and invest for any reason whatsoever. It is a wasted effort in the 1%-er’s game of steal-everything-that-is-subject-to-gravity-on-this-planet. I am done playing. Game over. What’s next?

    1. spooz

      You aren’t forced onto Medicaid as long as you are willing and able to continue buying your unsubsidized insurance. It would be fairer if people in your situation were able to, at least, be grouped in with the lowest income group that receives a subsidy through the ACA marketplace to make your insurance more affordable and avoid the hazard of Medicaid estate recovery. imo.`

    2. Jim Haygood

      ‘Am I going to be forced into Medicaid, even if I have insurance that meets ACA criteria?’

      The Obamacare penalty (or ‘tax,’ according to John Roberts) applies to people without coverage. To avoid being loaded on the cattle cars to Obama’s Medicaid concentration camps, keep your private coverage, or pay the no-coverage penalty ($95 this year at low income levels).

      Medicare offers an escape from the Medicaid asset grab to those who reach 65, and can manage the premiums ($104.90 a month for Part B), deductibles and copays.

    3. Jagger

      The trust has to be an irrevocable trust to protect your assets. Which means you better have complete trust in whoever runs the trust for you. If a regular trust in which you control the assets/money, then medicaid will use asset recovery to go after it. At least in my state.

      I would suggest finding several elderly law lawyers. They will usually give a free initial consultation and price quote. Then decide your best course. Because of 5 year lookback, don’t waste time.

    4. Katniss Everdeen

      And whatever else you do, DO NOT go shopping on the Exchanges–don’t even browse.

      Also, don’t apply for any means-tested government programs–your info will get into the system, and, according to the article, you could be dumped into the Medicaid program without even asking.

      How long will it be before they bypass all of this and just look at your tax forms before dumping you into the bucket?

      1. kareninca

        Just agreeing with Katniss. We have all read the “Obamacare forced Mom into Medicaid” article in the WSJ, right? If you go on the exchanges and your income is low enough, you will be automatically PUT on Medicaid. You have NO CHOICE. And like Katniss says, many government means-tested programs will do it. And like she says, no doubt your tax forms will soon do it.

        In the old days people sought legal advice in order to be able to benefit from Medicaid without losing assets (which was actually gross in the case of rich people who could readily afford to pay). Now we will have lawyers who specialize in how to avoid Medicaid. Because the amount that your care “costs” under Medicaid, will be grotesquely inflated.

        People here have complained about states that have not expanded Medicaid eligibility. Well, if you actively don’t want to be on Medicaid, moving to one might work. However, I am going to bet here that the politicians in those states will soon realize that these lovely clawback provisions and the “gotcha enrollments” of middle class people with assets to grab, make expansion worthwhile.

      2. ohmyheck

        Thank you all for the great advice. It seems my private insurance has double-duty—insuring that should anything catastrophic happen, I am covered as long as I can fork out $10K up front, and as house insurance, in that it keeps Medicaid from taking the roof over my offsprings’ heads.

        I have a short-tem job at the moment, care-giving an 85-year-old dementia patient, in-home. After observing what I have of her physical and mental state, and what the care-giving is doing to the lives of her extended family, I will be looking into what my options are for myself and my family, if my quality of life erodes to her level. There must be some country, somewhere, where my children can take me to have me mercifully euthanized. I’m serious.

  7. Jim Haygood

    ‘The ACA ended the asset test.’

    Before, people with assets planning to rely on Medicaid were limited to countable assets of $2,000, excluding a car, a principal residence, and a prepaid funeral plan. Those who had more assets couldn’t just give them away, because there was a 5-year lookback period, which could make them ineligible for Medicaid, according to a formula. The wise sought legal advice.

    Now all this front-end complication (which provided welcome employment to accountants, lawyers and tax specialists) is swept off, replaced by a simple asset grab on the back end. Sweet — for Big Gov and its partner, the health care cartel.

    There’s an end run around these highwaymen: gold, the last bearer asset. Convert your assets to gold, distribute it to whom you want. No records, no gift tax, no estate to be seized. Give gold, smash the state.

    1. Jagger

      Yes, I am curious exactly what are the details when the article states “ACA ended the asset test”. First I have heard of that.

    2. When In Doubt, Hyperventilate

      Not to hijack the Medicareless threat but on the gold; I agree completely . As a matter of fact, I have thought a lot about this whole end-of-life scam. I have decided that the crowning statement I could make with my life is to set aside enough resources to handle any pain but in the case of something like cancer or other profit-generating illness, do without the circus.

      EVERYTHING in America is for sale and our health–and ultimately life–are no different. Those who guide at the top of the heap care little whether their fortunes are made by shortchanging others’ even unto death. There is little we can do but what we CAN do is not go along.

      Not go along in banking. Not go along in medical “care.” Not go along in consuming. Not go along in being sucked into partisan politics. Not go along by turning tax cheats loose if you’re on the jury. Not go along figuring out every way to be the tax system and still remain free. Not go along by being the guy with stones enough at the cocktail party to call the president a murderer–which he is. Not go along by keeping your assets where these despicable, scabrous imitations of humanity can ever, ever get there hands on it.

      Smash the state? Indeed. Smash it every way you can.

    3. kareninca

      You beat me to that comment re gold, Jim Haygood. I’m starting to see some real overlap of the contents of posts here, and on Zero Hedge. Hmmmm. I’m waiting for the first Naked Capitalism reference to “one’s gold lost in a tragic boating accident.”

      Well, I don’t have kids, and I had planned to give away most assets well in advance of my likely demise anway. But if I had kids I would be going insane.

  8. Banger

    For me the main failure of Obamacare is that it has perpetuated a corrupt and highly wasteful system that should have been taken out in the back of the garage and shot.

    The problem is costs and the ability for various players in the racket that is health-care to inhibit innovation (that doesn’t produce large profits) and game the system to the max. If there is an expensive highly technical course of therapy it is encouraged, where there are clear low-cost “alternative” methods, i.e., herbs, various healing touch modalities, even laughter and other immune system builders these are all discouraged or ignored. From top to bottom this system must dissolve. Obamacare has brought the power of the state into forcing us to buy into this absurdly corrupt system. We should have listened to the Republicans and not allowed ourselves to be stampeded into demonizing them on this matter.

    1. Patricia

      “We should have listened to the Republicans and not allowed ourselves to be stampeded into demonizing them on this matter.”

      Except, of course, that the Republicans were just naysayers, not wanting to construct anything for the common good.

      But yes, those who watched the fiasco unfold and didn’t see the flaws were foolish. But then again, that would also include those Republicans who refused to address the flaws that were already systemic and were deepened by Obamacare.

      1. jeff fisher

        Pretty sure that if the republicans in the house of representatives put up a bill to patch this in a reasonable way the senate would pass it and the president would sign it.

        But they are probably busy voting to repeal Obamacare for the 50th or so time.

        I’m a bit dubious that the situation was previously as rosy as seems to be assumed in this discussion. Something like 2/3 of long term care in the US is paid for by medicaid and I think a large majority of those on long term care more than a year are on medicaid. Small estates were being exhausted pretty effectively by long term care before Obamacare.

        1. spooz

          Certainly things have not been rosy for the low income elderly who are forced to go on Medicaid to cover nursing home care, who will still face the asset test.
          The new crop of estates being plundered are those who may never end up in nursing homes, but are unlucky enough not to earn enough to participate in the ACA subsidized health insurance marketplace, unable to afford the high cost of insurance in the private marketplace, and not old enough to take advantage of Medicare. Those in this group who are aged 55-64 can get Medicaid health insurance without asset testing, but risk having their modest estates “recovered” when they die.

        2. Brooklin Bridge

          I’m a bit dubious that the situation was previously as rosy as seems to be assumed in this discussion.

          Perhaps, but Obamacare seems to have done less than nothing – and on purpose- to improve the situation. For instance, you were at least informed of the claw-back and had to give your permission.

          1. LucyLulu

            According to federal law, you still have to be informed. It specifies that the signatory page for Medicaid must contain a disclosure about estate recovery. If the federal exchange is not doing this, a case could be made for those affected not being liable for estate recovery.

            While states can pursue various estate recovery policies for Medicaid, up until now they have chosen not to pursue the vast majority of expenses (well under 1%). That doesn’t preclude states from becoming more aggressive in the future, however.

        3. NotTimothyGeithner

          I don’t know. I think the Dems are going to die by ACA. They have too much invested in their promises to accept any legislative changes. If they make one patch, people might start to wonder if ACA isn’t just a website problem.

          The GOP has too much wrapped up in being anti ACA to allow a change on their own.

    2. Brooklin Bridge

      “We should have listened to the Republicans…” The implications here are simply ridiculous. It’s even worse than saying we should have listened to those who throw chicken bones in the sand to predict the future. The motives of the Republicans who were nay-saying Obamacare were part and parcel of the ACA just like the negative space in your glove is part and parcel of your hand. At very best, their motive was to scare the public into taking whatever it could get before the Boogymen-bad-cops – the Rethugs -took it off the table altogether.

      1. Brooklin Bridge

        I might have been for Romney as president as a means of throwing a monkey wrench into the Democratic initiative to cut up and privatize Medicare and Social Security, but that is a far far cry from saying that the Republican party was trying to warn the public about the fascist movement toward government sponsored mandated corporate profit embodied in the Heritage Health Care fiasco that both ROMNEY AND Obama legislated.

        1. NotTimothyGeithner

          This is wishful thinking. Seniors and Boomers killed Dubya’s SS reform attempts. Democrats were lining up for a bipartisan consensus. The GOP took a major hit with their base and cooked up the Terry Schaevo incident which increased their popularity with the groups they had lost. Democratic supporters became more ardent supporters, but their votes were largely set in stone as anti-GOP in 2006 anyway.

          The Democrats lined up for wars, the Iraq Surge (after Democratic polling soared in the wake of being perceived as the anti-war party), Roberts and Alito confirmations, confirmation after confirmation for Greenspan, financial deregulation, free trade and pro pollution policies, and so forth. Admittedly, the filibuster is a gentleman’s agreement within the Democratic Party and has no force, so the Democrats couldn’t stop anything if the GOP wanted to pass it without Democratic votes.

          The Democrats would just play dopes to the GOP if Romney was President, and the Obots would whine about the cleverness of Karl Rove or something. They would denounce anyone who suggested the Democrats could be doing more as unserious about politics.

          1. Brooklin Bridge

            I’m not so sure, particularly not on the signature piece of legislation that has more or less has come to define the soul of the Democratic party. Until Obama came along and formally legitimized every wet dream Republicans ever had as being as much of a Democratic goal as a Republican one, many Democrats still had boundaries they couldn’t publicly cross, not openly, and the new deal was one of them. War and looking tough, on the other hand, has been a Dem must do since LBJ and tricky dick. I think Romney would have had a hell of a time screwing the SS/Medicare pooch and possibly even getting this fascist Heritage POS ACA template for the future of privatization with government GUIDOs through – though not as much difficulty as humping SS.

      2. Brooklin Bridge

        BTW, Bangor I wish there was a modify or edit button. I would change the initial sentence to more of a question than an exclamation. Knowing you somewhat, it’s unfair to say “ridiculous” or make hyperbolic statements about chicken bones. It’s more likely to be something like, 1) I misunderstood you 2) you are trying to liven up the conversation by lobbing petards into it 3) You’ve been hitting the cheap wine hard and should get some sleep :-)

        If you really think the Republicans as a party have said something aimed at the public’s benefit over this dual party give-a-way to private corporations in general and insurance companies in particular, and not simply hit on a few truths via the extremely ironic bounce-back of doublespeak, I would love to know what it is.

  9. JGordon

    More evidence that the more the government knows about you, the worse off you are. As well as having access to various benefits programs while starving the beast. Opting out means the vampires can’t suck your blood to keep their evil system going, even as you can drain it in turn.

    1. spooz

      Not sure how “starving the beast” helps those 55-64 years old citizens who don’t earn enough to participate in subsidized ACA health insurance exchanges and want to protect their estates from Medicaid recovery (those this post is referring to). How are they draining the system?

  10. TarheelDem

    Most seniors know the Medicaid situation inside out. And for most, the spend-down is not even a clawback and it is absolute, is a part of planning for long term care, and is one of the major factors that seniors delay long term care as long as possible. What the ACA tried to either cure or increase, depending on your perspective, is the cottage industry of Medicaid consultants who make good money conducting workshops in how to shelter your assets so that no matter what your income you can go on Medicaid for long term care. Most market these as “retirement planning workshops”.

    At the moment, there are millions of folks waiting for their Republican-dominated governments to pass Medicaid expansion authorizations to receive the federal funds. The issue of raids on assets isn’t terribly relevant to them because they have few to begin with.

    For low-income older Americans, the major issue in health care are the deductibles and co-pays that still make health care, even Medicare, unaffordable and the frequent balance billing battles that catch them between providers and insurers (including Medicare) over “non-allowable charges” and wind up causing additional out-of-pocket costs or medical debt.

    The entire spend-down architecture of Medicaid was a way to let middle class people get a part of a program that was designed originally to cover people in poverty, and it was done because it was a cheap fix to a growing middle class long term care crisis that appeared in the 1980s. It has been rife with all sorts of inequities and shenanigans. But grandma being in the nursing home on Medicaid is the primary way most middle class Americans know Medicaid.

    The obvious solution that is coming at some point is single payer Medicare/Medicaid for all with long term care. When that happens, the spend-down nonsense disappears because the rich won’t be envious of the poor for getting “something for nothing”. Right?

    1. CB

      Maybe most of the seniors you know “know the Medicaid situation inside out,” but I don’t think most seniors, across the nation, do. If you have a credible source for that assertion, please share it.

      1. TarheelDem

        Most seniors know that for long term care under Medicaid they have to spend down their assets because they have not planned in advance how to shelter them. It’s pretty simple. Going into the nursing home takes all one’s life savings first, and then it’s picked up by Medicaid.

        The important thing is not what seniors know but what must be changed in the health care system so knowing complicated rules and regulations is not necessary.

  11. washunate

    Thanks for highlighting this Yves. It seems like a lot of people not familiar with how the US healthcare system works think that Medicaid is a good system, something to be expanded rather than replaced.

      1. washunate

        Personally, I tend to cut Krugman more slack than some around here…

        But yeah, I’m basically talking about everybody back in 2007 and 2008 and 2009 who lambasted liberals that details don’t matter and just trust the president and all options are on the table and we can fix the bill later and the Senate requires 60 votes and a public option won’t pass and the bill will be popular once it’s implemented and this bill is the last train leaving the station and don’t make the perfect the enemy of the good and other hilarity.

        Man, I’m chuckling to myself just recalling those memories.

  12. ep3

    ok, me and my employer just got done with a meeting with our health insurance agent. they said it has become common for employers to only PAY the share of the health insurance policy that covers the employee and leave it up to the employee to pick up the difference. example – employee policy is $300. employer covers that in full. employee gets married, has two kids. policy is now $800. the employer still only covers the $300 while the employee must make up the $500 difference.
    now going back to the “Great improvements” made by obamacare, specifically allowing children to stay on a parents’ policy, how is this so much better? you can’t tell me it costs $500 more for kids coverage. and, how does this make things better for everyone?

    1. Steven Greenberg

      Me met with my health insurance agent, too.
      Sorry, I just couldn’t resist commenting on my pet peeve.

    1. Patricia

      Lambert: a person whose job is to help people think clearly. “Our business service includes a lambert to handle your logical fallacies.”

      See also Lambert: a kind of French cheese

      See also Lambert: on the lam with Bert. More commonly known as a Strether.

    2. EmilianoZ

      It’s a unit for measuring the luminance of diffusely reflecting surface.

      1 Lambert = (1/pi)*(candela per square centimetre)

  13. When In Doubt, Hyperventilate

    What is left out of the discussion–witness almost no mention above–is exactly how much “care” is needed. Obviously someone who has a severe stroke is incapacitated but do you know how much of the medicine prescribed, the “care” suggested and the costs expended are for things that benefit the System and not the patient?

    I have an idea and it’s a whole hell of a lot. I went to my doctor about feeling a little tired, lower energy than I am used to–I’m past 60. She repeated blood tests I had taken a few months earlier and then tried to talk me into a “sleep study.” Not that I need to get more sleep, but that I need to have a “study” done to let me know I need more sleep.

    This is how most of American medicine works. If you don’t get this, they will have you taking a bowl of pills every day and tested on every ridiculous excuse they can come up with.

    I’m done with them. I will see a doctor when I have a bone sticking through my trouser leg. Beyond that, it’s the same bullshit that America has become so good at.

    1. Yves Smith Post author

      If you are somewhere that has been hit with the frequent cold snaps this winer, it’s probably that. You expend more energy fighting the cold.

  14. lambert strether

    I don’t see what the issue is. The central dogma of neo-liberalism is that if you’re not good with money you should suffer, and, in the best case scenario, die. Granted, that’s not happening here, but at least the heirs are suffering. So what’s not to like?

    1. Brooklin Bridge

      Thank goodness it’s only the heirs of the poor and helpless who suffer. It would probably be illegal if it were levied against people who could fight back and then poor HuffPo might have to run a critical piece on it.

  15. Brooklin Bridge

    I’m not sure I understand this, but it sounds like there is no age limit – meaning you can be under 55 – AND eligible to recovery or claw-back if you receive long term care. Note the sentence, “It also discriminates by age since only Medicaid enrollees who use benefits in the state plan at age 55 and up are subject to estate recovery, but those who use benefits at age 54 or less are home free unless they receive long-term care. [emphasis mine]” I am NOT in favor of targeting those over 55, but I am even less in favor of targeting the poor and helpless, regardless of age. Does this mean that ANYONE that is on medicaid (i.e. poor) AND who receives long term care is subject to having their assets stripped?

    1. spooz

      The “asset test” has not changed. Those who receive long term care benefits through Medicaid will continue to have to meet it, whether disabled or elderly.

      As I pointed out above, the ACA allows recovery of estates for the entire amount that Medicaid has spent on you from the time you reach age 55. Along with doctor visits, treatments and medication, they are responsible for a “capitation charge”, premiums paid to Medicaid managed care plans in states that use that system. This charge, which varies by state and can run hundreds or thousands of dollars, and can exceed the actual cost of care for the month.
      Here is what Paul Craig Roberts had to say about it:
      “Some might think it fair that those who are enrolled in Medicaid pay back the benefits they received. However, under a mandate that requires all Americans to be covered by health insurance or pay a tax penalty to the IRS, estate recovery is unconscionable since Obamacare offers no other viable option for this income-segment of the population. It also discriminates by age since only Medicaid enrollees who use benefits in the state plan at age 55 and up are subject to estate recovery, but those who use benefits at age 54 or less are home free unless they receive long-term care. Under federal law, discrimination is not permitted on the basis of age, but, obviously, the U.S. government turns a blind eye to to its own law. Perhaps, when states need more money due to the Obamacare expansion of Medicaid, and as the jobless economy continues causing more people to be eligible, age discrimination will be broadened to 45 and up.”

      http://www.paulcraigroberts.org/2014/02/08/obamacare-final-payment-raiding-assets-low-income-poor-americans/

      1. Brooklin Bridge

        The “asset test” has not changed. Those who receive long term care benefits through Medicaid will continue to have to meet it, whether disabled or elderly.

        OK, I assume you mean “whether young or old”, but will they still be told – and have to agree that – they are going to loose their assets?

        1. Brooklin Bridge

          Also, the “capitation charge” is a slightly different issue though plenty ugly (well covered below by K Everdeen ). I assume that before ACA, a young person could not have gotten onto Medicaid except through a disability. Now they can get on Medicaid by simply being poor and suckered into signing up for ACA completely oblivious to the consequences. If they undergo long term care, they loose the modest inheritance that their parents put together, or their children loose the house or what?

      2. Yves Smith Post author

        That’s incorrect. Please read the extracts from the PCR article in the post above. It states explicitly that part of the ACA Medicaid expansion was to end the asset test in determining eligibility for Medicaid.

        Medicare is a different story. I suspect you are confusing the two.

        1. spooz

          I was referring to the fact that existing asset testing for long term care Medicaid will remain in place. The ACA eliminates the asset test for individuals eligible for ordinary health care based on their modified adjusted gross income, but the old rules apply for nursing home care.

          For example, with California Medicaid:

          “While the ACA has eliminated an asset test for many Medicaid applicants, if you are elderly or disabled, you will still need to have few assets to qualify for Medi-Cal: $2,000 for an individual and $3,000 for a couple. Some assets are not counted, such as a home if your spouse is living there or if you intend to return there, one vehicle, personal belongings, and small burial or life insurance policies.”

          http://www.nolo.com/legal-encyclopedia/when-californias-medi-cal-will-pay-nursing-home-assisted-living-home-health-care.html

      3. LucyLulu

        Nit-picky point. The ACA does not allow Medicaid estate recovery. It doesn’t address estate recovery at all. Estate recovery by Medicaid of expenses incurred from 55 years old on is not new. It was mandated back in 1993 under the Omnibus Reconciliation Act.

        The ACA has expanded the rolls of Medicaid however, thus increasing the numbers who could be subjected to estate recovery.

  16. LillithMc

    CA has long had a policy of attaching any asset with the bill from the use of medicaid by anyone of any age. Medicare also generates problems with co-pays for many seniors with little money. Those assets would have been attached anyway by the health care system often combined with refusing needed care.

    1. CB

      I have some fairly serious issues that I can’t have so much as diagnosed because I can’t afford the co-pays. Plenty of low income seniors are in the same straits. Just had a fractured wrist reduced and pinned–no choice, really. Can’t wait to see the bills for this. And dealing with billing depts is high stress, no matter how civil and professional, which they always are, the people you talk to.

  17. Katniss Everdeen

    While all this sounds pretty bad, guess what? THAT’S NOT ALL, FOLKS.

    According to the article, states are moving toward using PRIVATE INSURERS to manage their Medicaid populations. This involves CAPITATION PAYMENTS. From the article:

    Capitation Payments–a fixed monthly fee paid by the state to the Medicaid Managed Care Plan for each month you are enrolled in one of these plans, regardless of whether or not you use any medical services. If you do seek care, capitation payments can exceed the actual costs of services provided during the month.

    So what does THAT mean?

    According to the Massachusetts EOHHS Privacy Office: The estimated average capitation payment for October 1, 2013 through December 31, 2013 was $449.59 per month– an average annual total of $5,395.08. In other words, a person from age 55 through, let’s say, 62, accumulates $43,160.64 on his or her tally against assets including the home. There goes a chunk of your estate even if you didn’t use any medical care.

    And if that doesn’t curl your hair, there’s also a discussion of LIENS toward the end of the article. You know LIENS. Those legal things that a county recorder just SLAPS on your property without ever checking to see if they’r legitimate or not.

    Read to the end and weep.

  18. Brooklin Bridge

    HuffPo has pretty much decided to support Obamacare through thick and thin. It’s funny. Every now and then they will let a serious peice, say from Bill Black on economics, or Glen Greenwald on civil liberties, slip through, but they really hold the line on Obamacare. You see either favorable propaganda from their various “reporter” shaped thugs, or you see nothing at all. Interrupted only be events as obvious and glaring as the Obamacare roll-out and even then as fawning and sycophantic as humanly possible.

    One has to wonder if this is an agreed upon price for being able to publish negative stories in other areas, or if it is simply corporate honor amongst thieves.

    1. NotTimothyGeithner

      I would say its simple marketing. The Obots and their allies were nasty to suggestions that Obama-Care wasn’t wonderful. I for one stopped reading that rag some time ago. Why do you subject yourself to that internet cage liner?

      Lets consider what I perceive to be their audience. I suspect its Obots (the Democratic variety too) and low info voters who fancy themselves to be savvy, so if the Huff Post started to run, honest ACA assesments including the politics of 2009/10, what would be the reaction? The Obots would flip out. Melissa Jones Harris Perry of MSNBC called liberal critics of Obama racist, and amazingly enough has had to apologize for laughing at Mitt Romney for having a black grandson. The Obots have no shame. The Obots will go crazy, and they represent one bloc of Huff Post’s audience.

      The non Obot bloc is really important. As you point out, Huff Post is completely in the tank for ACA. What is the non-Obot group going to do when they hear Huff Post take a different tone? They may not be on the ball, but they will ask whether Huff Post has been completely honest. Huff Post isn’t a local paper of record. Its easy to replace. Not only will the Huff Post be the target of their disillusion, the contributors will not be able to shake the stigma of ACA’s inevitable perception as bad policy because it maintains too much of the status quo. The Obots (not the Democratic variety) will wither away moving onto their next obsession (vampires, book series turned into tv shows, and internet cat videos), but this group will still care about politics at some level. They may not care enough to know why and how, but they won’t want to follow someone they perceived as lying to them.

      With Bill Black and Glen Greenwald, the GOP has enough blood on their hands that they can be sufficiently blamed in the hearts of Huff Post readers while Obama’s hands can be justified as clean.

      1. Brooklin Bridge

        Why do you subject yourself to that internet cage liner?

        That’s a good question. I think I’m a bit of a head-line junkie and they really cater to that. And occasionally, they have the odd good piece that others miss. I avoid actually clicking on anything unless I see it referenced here or at some other reputable site, but every once in a while I bite. The flesh is weak.

        As to the Obots, I think HuffPo is a little more nuanced than that, but not much and I confess I have no idea at all what the criteria they use is. Sometimes they have posts that are really critical of Obama – little or no wiggle room – and these tend to conflict with your theory about Obots needing Republican foils. Most of the time, however, you are dead on.

        Perhaps they are trying to imitate a cheap version of the NYT that is by-and-large totally neo-liberal or even conservative but occasionally throws in an extremely well thought out piece or series just to sort of hang on to past illusions.

        1. Yves Smith Post author

          They have Shahien Nasiripour and Ryan Grimm and Zach Carter, all of whom do good reporting. But after that, the picking get mighty thin. You can see how seldom I link to it in Links. Even on widely-covered stories, the writing is generally worse than you find in established media outlets.

    2. LillithMc

      The House ACA included a public option that was a door to “medicare for all”. The negative and often false stories about the ACA are typical of the health care cartel who are happy to throw the sick under a bridge in the name of profits. Good if HuffPo defends the ACA because without it millions like me with “pre-existing conditions” would have been “disappeared”. Health care remains mostly centered in the states instead of a vast federal program as the ACA is often described. The ACA encourages states to develop their own “universal programs” like Oregon and Vermont. CA did a good job of negotiating lower premiums. The “mandate” is the problem for many, but reform is not possible without it. Give it a chance to work and then reform it before returning to the old system of giving health insurance to the healthy and kicking the sick to the curb.

      1. NotTimothyGeithner

        “Give it a chance to work and then reform it”

        We already know what the problems are and how to fix them. This is an excuse for ACA not being better received. Yes, Obama and the Democrats own the POS healthcare system in this country, and yes, the longer it doesn’t work the more people needlessly suffer.

        How much more time? Six months?

        As far as the House version goes, they knew Obama had a different plan. The House version was a stunt so sycophants could say Democrats didn’t betray their promises.

        1. LillithMc

          I am listening for the solutions that involve all Americans receiving affordable health care on par with the 37 nations who do it better.

          1. OIFVet

            Its called single payer. And Obamacare was designed not as a pathway to it but as an immovable obstacle to getting there.

          2. NotTimothyGeithner

            Those solutions are everywhere. The question is why are you ignoring that reality or not proposing your own solutions*. The answer is that your goal is to deflect responsibility for this travesty by pretending better solutions didn’t exist.

            Barack Obama and the Democrats did not operate in good faith, rejected doable and superior ideas, and are now doing everything t h en can to n to take responsibility.

            I will ask how many more Freedman Units does ACA need?

            *Although I myself am not a believer, Ecclesiasties 1:9 sums up my views on original ideas. If you come up with an idea, it’s already out there in some form.

          3. Brooklin Bridge

            I suppose someone who fell off the Titanic and found a log to float on might have said the same thing, “their emergency policy isn’t that bad, look at me”. But for the most part it was not the passengers who benefited from cheap rivets and Obamacare was likewise designed to profit big business and not people in need of health care.

            And indeed, thanks to the massive corporate give-a-ways and propaganda on levels never before seen, it will be a generation or more before we can get the discussion back to single payer, if we ever get there at all.

  19. bruce

    EXPLAINING OBAMACARE:
    John is a healthy 55 y.o. man, and Junior is his healthy 25 y.o. son. One day in April when the ticks were out, the two made their way through a dense woodland thicket, and when they emerged, there were hundreds of tiny arachnids attached to their bodies, heads already burrowed beneath their skin. They approached the Obamacare medic wagon, and the medic said…

    “Those aren’t bloodsucking parasites, they’re STAKEHOLDERS! What we need to do here is transplant a pint of blood from Junior to John. John will be rosy again, Junior’s younger, more vital bone marrow will replenish the blood cells faster, and the other stakeholders’ interests will not be impaired.
    YOU CAN HAVE CAPITALIST MEDICINE. YOU CAN HAVE SOCIALIZED MEDICINE. WHAT YOU CAN’T HAVE IS CAPITALIST MEDICINE AND SOCIALIZED MEDICINE AT THE SAME TIME!

  20. bobh

    Both this post and the explanations of how Obamacare works by Paul Craig Roberts in the link are complicated. A much simpler version:

    1)Obamacare is an effort to increase the number of Americans with health insurance so they can participate in our national health care delivery system. It does this by requiring uninsured people to buy health insurance and by creating a second tier of low quality health insurance for poor people that gives them access to second tier health care. For some poor people, Obamacare pays some or all of the monthly premiums for this insurance coverage.

    2) Obamacare does almost nothing to reduce inefficiencies in the health care system or to limit the large and growing profits of the pharmaceutical, insurance and health care delivery industries that exploit this system.

    3) Obamacare doesn’t raise taxes on any sector of the population to pay for expanded insurance coverage, health care or industry profits.

    4)Since someone has to pay for this expansion, Obamacare makes the newly insured people pay for it, mostly through premiums, copays and out-of-pocket payments until deductibles are reached.

    5)If these people get sick and they are not rich, Obamacare will make them either poor, more poor or bankrupt.

    6) If they have any assets left when they die, Obamacare can them too.

    1. Yves Smith Post author

      Bob,

      This is a good high-level overview, but you miss a key point. Details matter. Only certain people are exposed to 6. They have to have certain types of medical expenses, and be in Medicaid. You can wind up in Medicaid without intending to under Obamacare (there are various ways you can be auto enrolled, including checking automatic renewal provisions for Obamacare policies and then suffering a loss of income). Disclosure of the provisions around 6 is poor, meaning many people aren’t given the opportunity to make an informed consent. And people who have decent assets but low incomes might be better off paying the penalty.

      1. bobh

        I was trying to state very simply what is going on, mostly for myself as an exercise. I didn’t actually know the details of this mechanism for extracting the last nickel from a subset of low-income people, or how selective (and thus unfair) it is, until I read the post. I imagine most of the victims, or their children, also won’t understand what happened to their nest egg until it is gone. That obscurity is a feature, not a bug, for the people marketing Obamacare as a gift to poor people. My point–and it has been made at NC many times, including in this post–was that the people who designed Obamacare were intent from the beginning on expanding the system as it is, preserving excessive costs and adding new profits for the profiteers, while making poor people pick up as much of the tab as possible.

  21. JCC

    “And people who have decent assets but low incomes might be better off paying the penalty.”

    Or maybe selling off the assets and becoming a resident alien in countries with cheaper health care… like Ecuador, Mexico, Costa Rica, Paraguay… ??? Not that difficult to do if you’re willing to leave the U.S. long-term.

    I happen to be in that limbo between affording to avoid medicaid and left with no assets anyway if I choose to pay the penalties and potential deductibles. It might be wiser to just leave.

  22. nikolai and elena

    They finally found a way to force a population into debt. Democrats did this. Clinton and Obama and their congressional bagmen. We’re going to put their heads on sticks.

    The Democrats will cease to exist as a party. Their apparatchiks will be shat out of public life and driven into hiding. Not electorally, you don’t kill this cancer by voting. The way you do it is, everybody throws a monkey wrench into the works every day until one day BANG and the government wood-chipper stops. Just wreck this state. It has no reason to exist.

  23. Sierra7

    After reading the blog, “digesting” the comments…..(in-digesting)……
    I figure immediate suicide is worth looking at……
    Between the ACA, all the rules governing Medicaid……nothing really simple and understanding……..and I’m in reasonably “good” health for an 83 yr old……..why must the system of health care be so, um, “complicated”?
    What the hell is the matter with our so-called “advanced” society that we don’t by now have that elusive, damned into Perdition, Single Payer??
    I guess we are not so advanced after all……
    We are still mired in the dark ages stage of personal greed and living within the horrid corridors of slimed, corrupt politics coupled with violent capitalism…….
    What university will be giving all Americans a “Masters” in, “American Healthcare”?………so they may navigate the system?

  24. OIFVet

    It makes me angry that the system forces people to think this way. I am really sorry, I hope you cheer up.

  25. Mark Lovas

    Last night I read through most of the comments, after reading the original post and part of the linked article. I failed to see one thing mentioned, something I have been increasingly pained by noticing in the past five years. I am middle-aged and my parents are approaching ninety. One parent is considerably more attuned to daily goings-on than the other, and so ends up with a much greater burden of responsibility. None of their children live especially close to them. (I am, in fact, living outside of the USA.) But, on top of the very real need for medical attention, and the difficulties attendant on that–e.g., getting a not very limber elderly person into a vehicle and transporting them to a doctor twenty or thirty minutes away by car–there is an enormous mental burden. There is an enormous amount of emotional anxiety. Will someone fall again? What might this new problem mean? Is it serious? And there is tremendous social isolation. Obviously, this is only another aspect of the problem of the suburbs. I don’t know whether any other country really does a better job of solving this. However I thought it would be worth pointing this out (or reminding those who know about it already) that this is just as big a problem as access to medical care. As the conversation has now opened up to the broader issue of the problems of the elderly (and their children), it’s worth noticing that any real solution needs to address the problem of isolation as well. I don’t pretend to have an answer, and I also realize that it may seem I’m somehow demanding too much; but, I think problems don’t get solved by ignoring them.

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